Objectives To discuss what the world think about Africa To
discuss the Structural Adjustment programs (SAPs) for Africa
Discuss the issues of agricultural production in: Ethiopia Somalia
Malawi Zimbabwe To gauge student views on Africa The purpose of
this topic today is to analyze the view of what the world think
about Africa.
Slide 3
Introduction Most people think Africa is land with lots of
problems; Associated with political instabilities leading to bad
governance and corrupt practices Wars Economic and social
Developmental challenges poverty and hunger Low agricultural
productivity Scourge of diseases, etc., But they forget:
Flourishing business environment Investing in the people -
education Mining, Oil Agriculture cocoa, tea, coffee, sugarcane
tourism This lesson will look at the causes of Africas down
fall
Slide 4
Overview of Food Production in Africa The eve of independence
in the mid-fifties, 45 colonies and two independent
nations(Ethiopia and Liberia) in SSA Political independence was
launched on grand scale in 1960 About 17 colonies won their
independence In 1995 all forty-seven nations in SSA were free of
colonial rule In the 1960, Africa had a booming agricultural export
sector
Slide 5
Overview of Food production in Africa(2) It was a modest net
exporter of food These favorable initial conditions and the removal
of colonial shackles made Most leaders of new nations to optimistic
that Africa could catch-up with industrial nation by the turn of
the century Today, in Africa, the atmosphere is filled with
disappointment Africa is poorest part of the global economy Hostage
to a chronic food bottlenecks
Slide 6
Overview of Food production in Africa(3) In the past 50
decades, much can be learned about the complexity and diversity of
African Agriculture Motivation of farmers Weather patterns The use
and misuse of foreign aid There literally thousands of evaluations
of ill-fated agricultural strategies and projects including many
imported models; State farm Communal farms Farm settlement
Slide 7
Overview of Food production in Africa(4) Bad weather and
alleged lack of economic motivation of African farmers are not the
causes of Africas food crisis. Studies have shown that when African
farmers have access to Incentives Technology Support services
Markets They have proven to be as calculating money managers as
farmers in Iowa, Arkansas or the rice bowl of Asia (Jones 1960)
Weather can be ruled out as a cause of Africas chronic food gap
Because annual food production grew at only half the rate of
population This proves that drought for a year or two was not the
cause of long-term agricultural stagnation
Slide 8
Sixties - seventies Failure of state farms, farm settlements,
communal farms and integrated rural development projects Attention
turned to poor economic policies as the cause of poor agrarian
stagnation World Bank study led by Elliot Berg argued that the
fundamental cause of Africas economic stagnation was the following:
Bad economic policies which includes Overvalued exchanged rates
Heavy taxation Money losing state industries Internal factors
Africas response to the report charged that external policies of
industrial nation were the cause of the development crisis
Slide 9
The First SAPs: IMF and World Bank Rationale The Berg report
provided rationale for IMF and World Bank loans and grants for
African Countries To help African governments carryout Structural
Adjustment Programs (SAPs) Aims were to: Redesigning country
policies Reducing the size of government bureaucracies and
subsidies to industries Correcting the bias against agriculture in
price, tax and exchange rate policies
Slide 10
The First SAPs: IMF and World Bank Rationale(2) History has
also shown that redesigning economic policies are long-term and
unpredictable processes New policy regime are put in place, cannot
quickly slay the dragons of economic stagnation and poverty Africas
structural adjustment experience humbled the World Bank
Slide 11
Second Round of SAPs Broadened to include: Institutional reform
Rebuilding of human capital Fiscal decentralization Broader
participation of civil society in the economy Africas transition
from a controlled to a more open and market-oriented approach to
managing economies requires more investigation.
Slide 12
Today in Africa Food crisis is the most challenging problem
Two-thirds of the people are dependent on agriculture and the rural
economy for their livelihood Getting agriculture moving is high on
main platforms Africans are looking inwards for ideas on increasing
agricultural productivity
Slide 13
Mainstream news from Africa Todays mainstream news outlet
focuses on the following: High level of inequality and poverty
Dangerous levels of unemployment record droughts and flooding, rise
in food prices, biofuel production and land grabs by foreign
investors with an added emphasis on the role of the Somali
terrorist group Al-Shabaab Political instabilities Policies that
are backward oriented Yet these factors alone are not responsible
for the famine or turmoil in Africa
Slide 14
Putting thing in Perspective The factors mentioned on the
previous slide, intensified an already dire hunger crisis that has
persisted in Sub-Saharan Africa for decades,persisted In Africa,
lending policies pushed by the World Bank and International
Monetary Fund (IMF) That transformed a self-sufficient,
food-producing Africa into a continent dependent on imports and
food aid, This has pinned the continent vulnerable to food
emergencies and famine.
Slide 15
The Great Transformation The experience of Mexico and the
Philippines was paralleled in one country after another subjected
to the ministrations of the IMF and the WTO. A study of fourteen
countries by the UN's Food and Agricultural Organization found that
the levels of food imports in 1995-98 exceeded those in 1990-94.
This was not surprising, since one of the main goals of the WTO's
Agreement on Agriculture was to open up markets in developing
countries so they could absorb surplus production in the
North.
Slide 16
Great Transformation(2) In 1986, the then - Secretary John
Block put it US Agriculture, "The idea that developing countries
should feed themselves is an anachronism from a bygone era. They
could better ensure their food security by relying on US
agricultural products, which are available in most cases at lower
cost."
Slide 17
Great Transformation..(3) The apostles of the free market and
the defenders of dumping may seem to be at different ends of the
spectrum, but the policies they advocate are bringing about the
same result: a globalized capitalist industrial agriculture.
Developing countries are being integrated into a system where
export-oriented production of meat and grain, These are dominated
by large industrial farms like those run by the multinational
Slide 18
Great Transformation..(4) Where technology is continually
upgraded by advances in genetic engineering from firms like
Monsanto. And the elimination of tariff and nontariff barriers is
facilitating a global agricultural supermarket of elite and
middle-class consumers Which are serviced by grain-trading
corporations
Slide 19
Background on policy initiatives There is little room for the
hundreds of millions of rural and urban poor in this integrated
global market. They are confined to giant suburban, where they
contend with food prices that are often much higher than the
supermarket prices, or to rural reservations, where they are
trapped in marginal agricultural activities and increasingly
vulnerable to hunger. Indeed, within the same country, famine in
the marginalized sector sometimes coexists with prosperity in the
globalized sector
Slide 20
African Perspectives At the time of decolonization, in the
1960s, Africa was actually a net food exporter. Today the continent
imports 25 percent of its food; Almost every country is a net
importer. Hunger and famine have become recurrent phenomena, The
past three years have seen food emergencies break out in The Horn
of Africa, The Sahel, Southern and Central Africa.
Slide 21
Snapshot on Africa Agriculture in Africa is in deep crisis, The
causes range from wars to bad governance, lack of agricultural
technology and the spread of HIV/AIDS. However, as in Mexico and
the Philippines, an important part of the explanation is The
phasing out of government controls and support mechanisms under the
IMF and World Bank -Structural Adjustment Programs (SAPs) imposed
as the price for assistance in servicing external debt.
Slide 22
A scenario from Ethiopia Dr. Tewolde Behran, General Manager of
the Environmental Protection Authority in Ethiopia, Explains that
drought is not the cause of famine in Africa. Storage and transport
are the two big problems. Two years ago in Ethiopia, when there was
a surplus of food, Farmers could not sell their produce (locally or
on the foreign market) and thus did not get the capital they needed
for future crops.
Slide 23
A scenario from Ethiopia. One hundred kilos (2,2046 pounds) of
maize would sell for as little as $4 and Saudi Arabia wanted to buy
this cheap maize. However, by the time the maize got to the port
its price would have tripled because transport costs are so high.
It was marginally cheaper for Saudi Arabia to instead buy maize
that came all the way from the U.S. The U.S. is underselling
starving nations and the food shortages are actually exasperated by
this practice.
Slide 24
A scenario from Ethiopia Instead of reducing the debt, since
1980, SAPs have increased African debt by 500 percent, creating a
domino effect of disasters: prolonged famine, conflict, abject
poverty, environmental exploitation) linked to an estimated 21
million deaths and, In the process, transferring hundreds of
billion dollars to the West.
Slide 25
A case for Somalia The Globalization of Poverty, explains that
despite frequent droughts, Somalias economy, The Globalization of
Poverty Which is led by small-scale farmers and pastoralists or
nomadic herdsmen, was self-sufficient in food well into the 1970s.
The pastoralists proved quite successful as livestock produced 80
percent of Somalias export earnings through 1983. But under SAPs,
veterinarian services for livestock were privatized, Making it
difficult and unaffordable for herders in rural grazing areas to
access animal healthcare, This led to ultimately devastating
pastoralists who made up half of the population.
Slide 26
A case for Somalia As for agriculture, the cheap imports of
rice and wheat displaced small farmers, and resources were diverted
to grow export commodities. Exacerbating the problem, Water points
and boreholes dried up due to lack of maintenance, or were
privatized by local merchants and rich farmers, due to the
privatization of water resources.
Slide 27
A case of Malawi The role of structural adjustment on Malawi in
the late 1990s, when subsistence farmers were provided with starter
packs of free fertilizers and seeds. The program yielded a surplus
of maize But then the World Bank and IMF stepped in to dismantle
the program and compelled the government to sell the majority of
its grain reserves in order to service its debt.
Slide 28
A case of Zimbabwe Zimbabwes dualistic agricultural sectors has
two subsectors: Large-scale commercial farming sector The
smallholder sector Maize is the national food staple of Zimbabwe
Smallholders have historically had the largest area of maize under
cultivation Zimbabwe generated two maize revolutions The first was
spearheaded by large-scale commercial farmers in the 1960s and
1970s The second was launched by smallholders after independence in
1980
Slide 29
Changing roles of the public and private sectors Experiences in
the four mentioned countries (Ethiopia, Somalia, Malawi and
Zimbabwe) illustrates that smallholders can fulfill their
productivity potential if they are supported by Political
leadership Macroeconomic stability Cost effective farmer support
institutions A stream of new technology from home and abroad Access
to domestic and international markets
Slide 30
Changing roles of the public and private sectors.(2) Develop
legal framework and incentive that will encourage private
investment in the entire food system, including R&D Farmer
support organizations Production Marketing Processing Improvement
in rural infrastructure telecommunications, roads and other
infrastructural services in smallholder areas These should have
economic, social, and political benefits in a long run.
Slide 31
SAPs and Famine in Africa What does this have to do with
famine? Debt perpetual forces government to divert spending to debt
repayments Rather than investing in basic infrastructure like
health care, education SAPs initiated the collapse of African food
security by; Diverting land, water and labor away from small-scale
farming towards the production of cash crops Whose earning were
used to pay debt These SAPs demanded the elimination of subsidies
for small scale farmers Forced peasant farmers to compete with an
influx of cheap subsidized commercial staples Meanwhile U.S and
Europe continues to prove their agricultural sector with billions
if dollars in subsidies.
Slide 32
In Summary Africa can rid itself from all the problems if
proper policies are suggested and implemented. Africas structural
adjustment (suggested by the WB) experience has humbled the World
bank. The juxtaposition of the dream of the Berg report and the
reality of Africas development experience in the 80s and 90s helps
explain why the World bank recently declared that effective
institution matter as much as sensible policies in
development.
Slide 33
Top 5 Largest oil Reserves in Africa Proven Reserves of Oil
(bbl)
Slide 34
Largest Economies in Africa Based on annual GDP
Slide 35
Reflection questions 1. What are your perceptions on Africa? 2.
Which year/s was Africa a food exporter? 3. What does SAPs stands
for? 4. Give two examples of SAP? 5. What does the SAPs have to do
with famine? 6. Use the HDI Report to identify the top ten richest
and top ten poorest countries in Africa. Use GNI as an indicator.
7. According to Dr. Tewolde Behran, what were the two major factors
that caused famine in Ethiopia? Do you agree to this claim? 8. What
are the major sectors of the Zimbabwean agriculture? 9. What was
the problem caused by SAPs in Somalia? 10. How many countries
produces oil in Africa? 11. Which countries produce cocoa and
coffee in Africa? 12. Suggest any policies that can be helpful to
increase agricultural productivity in smallholder farming?